The card industry is closely watching the rumors about Hyundai Card’s adoption of Apple Pay. If the rumors come true, it could have a significant impact on the structure of the card industry.
Currently, it is impossible to use simple payment in Korea for iPhone, so you have to pay directly with a physical card. If Apple Pay is introduced here, it is highly likely that customers using iPhone will move to Hyundai Card. The number of iPhone users in Korea is estimated to be over 10 million.
Hyundai Card Apple Pay introduction rumors… Growing interest in the credit card industry
According to the credit industry on the 12th, it is known that Hyundai Card is in the process of discussing the introduction of Apple Pay.
In detail, it is reported that Hyundai Card is in discussions with Apple about having a one-year exclusive right to Apple Pay in Korea. In particular, some are predicting that Apple Pay will be available at some card merchants as early as this year.
If Apple Pay’s domestic landing is confirmed, an important point is expected to be the handset issue. In Korea, there are many card company affiliates that do not have NFC payment terminals, because Apple Pay uses only short-range wireless communication (NFC) payment methods. NFC is a technology that enables payment by touching a device such as a smartphone to a terminal without a physical card.
The biggest obstacle to the spread of NFC payment terminals in Korea is cost. In order to install an NFC terminal, it costs at least 150,000 to 200,000 won per store. Considering that there are more than 3 million domestic credit card merchants in Korea, hundreds of billions of won is spent just for the supply of terminals.
Therefore, in the past, the card industry reviewed the introduction of Apple Pay service, but it was hampered by the cost of supplying the handset. In addition, Apple is said to have looked into the domestic expansion of Apple Pay, but it has not been done due to problems with the supply of handsets and high fees.
In addition, Samsung Pay, Korea’s representative simple payment service, adopts both NFC and magnetic secure transmission (MST) methods. The MST method can be used in most domestic payment terminals. Therefore, credit card companies were not in a hurry to introduce NFC, which is costly.
However, the situation is changing recently. First of all, the NFC payment method is already becoming more common overseas. Currently, it is used in about 70 countries, and in the case of China and Japan, which are neighboring countries of Korea, Apple Pay was introduced in 2016.
In addition, Samsung Electronics is also promoting the transition to NFC. In other words, even if you use Samsung Pay, the era of NFC is approaching.
If this rumor about the introduction of Apple Pay becomes a reality, it is expected that there will be considerable impact. Card companies are paying particular attention. This is because, if Hyundai Card takes the lead in this method, there is little chance of changes in the market structure, etc.
iPhone users often have high levels of brand loyalty as well as satisfaction. To the extent of accepting the hassle of carrying a physical card to use the iPhone. Accordingly, when Hyundai Card becomes available for Apple Pay, it is expected that many consumers will change card companies.
In particular, if the benefits and essential elements of the card currently being used are low, the change of card company for using Apple Pay is expected to become more frequent.
An official from the card industry said, “If Hyundai Card actually proceeds with the introduction of Apple Pay, interest will be gathered in how it solves the cost problem of the introduction of NFC payment terminals and the aspect of profitability.” “For iPhone users, mobile phones are As there are many people who only use iPhones, and there is a high possibility that customers will move due to Apple Pay, if Hyundai Card introduces Apple Pay, other companies will have no choice but to move to join as a latecomer.”
The official continued, “In particular, card commission revenue is important, but recently the importance of data is also increasing, so the movement of users is an important issue,” the official said. it was
Another official said, “Of course, the introduction is important, but how much influence it will have on the card market will depend on the duration of the monopoly. It may not be possible, but you can think of this period as a period of preparation.”
The official continued, “Especially since it is the first time, Hyundai Card can obtain its own data, etc. I think it could happen,” he added.
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